Life Insurer Accused of Using Reinsurance Transactions to Defraud Investors

KANSAS CITY — An Alabama man has filed a purported class action accusing Security Benefit Life Insurance Co. and its parent company of entering into reinsurance transactions designed to make the insurer appear financially healthy to investors while selling them low-performing annuities.

In a June 6 amended complaint filed in the U.S. District Court for the District of Kansas, the plaintiff accuses Security Life’s parent company, Guggenheim Partners LLC, of raiding the insurer’s cash, leaving policyholders and annuity holders unprotected.

Plaintiff Albert Ogles’ claims arise out of his investment in defendant Security Benefit Life’s “Total Value Annuity,” known as a …